Canada’s annual inflation rate slipped to 1.9% in August, down from the 2.3% recorded in July, Statistics Canada said today.

A slower rise in the price of gasoline last month led to the smaller overall increase in the cost of the living, StatsCan said.

Economists had expected the inflation rate to ease slightly from July’s 2.3% rate, but only by 0.1 or 0.2 percentage points.

Core inflation, which excludes such volatile components as gasoline, natural gas and food, also fell dramatically. It dropped from July’s 1.9% to just 1.5% last month. Economists had been expecting the core rate to be unchanged.

Commenting on the report BMO Nesbitt Burns senior economist Douglas Porter said “Canadian inflation has just become a toothless tiger.”

Porter said that although he expected the Bank of Canada would raise interest rates again in October, Friday’s report “will certainly cast some doubt on a December move.”

Meanwhile, StatsCan said growth of the leading indicator continued to moderate in August, slipping to 0.5% after slight downward-revised gains of 0.6% in July and 0.9% in May and June.

According to StatsCan, the slowdown over the last two months reflected housing and the U.S. leading indicator backing off from unsustainable gains.

Growth remained widespread, however, with 8 of the 10 components rising, the same as in June and July. The two components that fell remained the stock market and the average workweek in manufacturing, StatsCan said.